Suspected Ledger Theft Linked to Shift from USDT to USDD to Evade Freezes

A wallet associated with a series of thefts from Ledger hardware wallet users has converted approximately 2 million USDT into USDD, aiming to evade Tether's freezing capabilities. This transaction occurred after Tether blacklisted over 20 addresses connected to the stolen assets, freezing around $10 million in USDT. Investigators have traced the movement of stolen funds, which total between $86 million and $93 million, across various blockchains including Ethereum, Tron, and Bitcoin, with the assistance of on-chain analysis firms such as Specter and MistTrack.

On October 9, 2026, the suspected thief executed a swap of roughly 14.7 million USDT for about 14.6 million USDD using the platform SUN.io. Although this swap resulted in a slight loss of value, USDD is not subject to Tether's freeze controls. Additionally, around 430 ETH, valued at approximately $1.07 million, was funneled through Tornado Cash, with some funds reportedly ending up in Binance hot wallets.

The wallets involved in these thefts are estimated to still contain around $70.6 million in cryptocurrency, including approximately 11,406 ETH worth about $28 million, 213 BTC valued at $17.6 million, and 10.91 million USDT, part of which remains frozen. The thefts have been linked to Ledger hardware wallets purchased through CryptoBilis, a reseller operating in Southeast Asia, prompting Ledger to investigate a potential supply-chain compromise and suspend sales through this channel. Customers who recently acquired wallets have been advised to transfer their funds to new wallets with fresh seed phrases.

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Source: KLEA News